Nepali financial sector still unripe

Kathmandu, September 25:

Nepal’s financial sector is still not fully developed, which has affected ‘fast and effective’ advancement in bringing new financial instruments in the market, said a high level official of the Punjab National Bank (PNB) of India who is in the capital on a short visit. S C Gupta, chairman and managing director of PNB while talking to The Himalayan Times urged the concerned authorities to introduce more financial instruments in advancing financial sector

in a changed competitive environment. The financial market across the global is growing very fast, in such a context, there is also a need to introduce new products to cope up with emerging challenges, said Gupta. He also suggested Nepal government to introduce more investor-friendly financial policies to boost capital market with new innovations. However, Gupta supported the directives, rules and regulations issued by Nepal Rastra Bank (NRB) saying that central bank’s policies are compatible considering the challenges the financial sector brought about in today’s globalised market.

B K Shrestha, chairman of Everest Bank Ltd, a joint venture with PNB of India, said that being a joint venture, EBL has got immense opportunities to advance it further in terms of business and latest technologies and new products. “As PNB has over 4000 branches across India, EBL customers can avail services from any of these branches, which is a great advantage to our customers,” he said, adding that the 100-plus years experience of PNB is the guiding factor for the betterment of EBL. Gupta said that EBL has sound dividend policy and committed for delivering good services.

It has already emerged as a strong and competitive financial institution in the Nepali financial market, said he. Shrestha said that the bank is coming out with new concept in housing loan through ‘insurance policy scheme’, which is the best tool for the ‘dependents’ of the borrower even after his death. “EBL has always adopted new and innovative concepts,” he added.

According to Gupta, EBL’s gross NPA is at 1.6 per cent, however, net NPA is nil. It shows that the bank is functioning smoothly. The bank has posted Rs 376.91 million operating profit in the fiscal year 2004-05, which is a growth by 19.14 per cent in comparison to last year.